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The Canadian dollar weakened to a near four-week low against its U.S. counterpart on Friday as investors worried that a rise in American coronavirus infections could slow the reopening of the U.S. economy.

Many U.S. states that were spared the brunt of the initial outbreak or moved early to lift movement restrictions are seeing a resurgence in new infections, with Texas and Florida ordering bars to close down again on Friday.

“That (news) triggered a large risk-off move around the London close,” said Erik Bregar, head of FX Strategy at the Exchange Bank of Canada.

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The market was working on the assumption that there would be pockets of new cases but that the United States was “still in the reopening phase,” Bregar said.

Canada sends about 75% of its exports to the United States, including oil. U.S. crude oil futures settled 0.6% lower at $38.49 a barrel, while Wall Street’s major indexes tumbled.

The Canadian dollar was trading 0.2% lower at 1.3664 to the greenback, or 73.19 U.S. cents. The currency hit its weakest intraday level since June 1 at 1.3715.

A resurgence of bets on the Federal Reserve cutting interest rates below zero helped the loonie claw back some of its decline, said Bregar.

“It seems right now the bond market wants to force the Fed’s hand again,” Bregar said.

For the week, the loonie was down 0.4%. Its decline this week came as investors worried that Washington could reimpose tariffs on Canadian aluminum and after Canada lost one of its coveted triple-A ratings when Fitch downgraded it for the first time.

Canadian government bond yields eased across a flatter curve in sympathy with U.S. Treasuries. The 10-year fell nearly 3 basis points to its lowest level since June 15 at about 0.500%.

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